Last week review (May 14-19)

Analysis Materials 21 May 2012 12:00 (UTC +04:00)

May 14

Coverage of broadband Internet expanding in Azerbaijan

Optic line length of 600 kilometers was laid in the frame of the project on expansion of broadband Internet in rural areas.

The production association involves 7 private Internet service providers to the project, 5 of which have already begun to implement the project. Fiber-optic cable was laid in the direction of 11 telecom units with length of 200 kilometers through the efforts of private providers.

According to forecasts of Aztelekom, all the villages in Azerbaijan will be covered by fiber-optic lines by the end of the year. The operator plans to bring broadband services and services based on them directly into the homes of end users.

Azerbaijani energy operator fully ready for Eurovision-2012 song contest

Azerenergy (production and distribution of electricity in Azerbaijan) will ensure energy supply is at a high level during the Eurovision-2012 song contest in Baku.

The company said that power generating and transmission capacities are fully ready to provide the capital with electricity. Azerenergy will work in an emergency state during the Eurovision-2012 song contest in Baku.

Azerbaijan Airlines expands fleet

Boeing 767-300ER passenger plane will be delivered to Baku in late May - early June, spokesman for "Azerbaijan Airlines" Maharram Safarli said. "We are making efforts for it to arrive in the capital on June 2, the day of the professional holiday of civil aviation workers," Safarli said. He said that Baku will get two freight carriers Boeing 767 until the end of this year.

The company received passenger aircraft Boeing 767-300ER under the contract with Boeing in June 2011. AZAL first in Central Asia will receive the most modern aircrafts - Boeing-787 Dreamliner (two aircrafts) from 2014.

This will allow AZAL to launch flights over long distances, particularly in North and South America, South-East Asia and other regions of the world.

Standard & Poor's improves assessment of Azerbaijan's banking industry risk

Standard & Poor's Ratings Services has revised its Banking Industry Country Risk Assessment (BICRA) on Azerbaijan (BBB-/Stable/A-3) to group '8' from group '9'.

"The economic risk score was revised to '7' from '8' and the industry risk score to '8' from '9'," the statement said.

The BICRA summarizes view of Standard & Poor's of the risks that a bank operating in a particular country and banking industry faces relative to those in other banking industries. A BICRA is scored on a scale from 1 to 10, ranging from the lowest-risk banking systems (group 1) to the highest-risk (group 10). Other countries in BICRA group '8' include Argentina, Kazakhstan, Uzbekistan, Nigeria, and Georgia.

May 15

Azerbaijan to host Plastex Caspian 2012 exhibition

The Baku Expo Center will host on May 15-17 the Second Plastex and Rubber Caspian International Exhibition, exhibition organizer Iteca Caspian said.

The exhibition this year will feature products of 25 companies from Azerbaijan, Austria, Bosnia and Herzegovina, Germany, India, Italy and other countries. This includes equipment for processing plastics and rubber, raw materials and additives. There will also be presented manufacturers of finished products using plastics and rubber.

The relevance of the Plastex Caspian exhibition is confirmed by the fact that Azerbaijan observes increase in chemical production, the report says. Thus, according to statistics from the State Committee of Azerbaijan, for 2011 production growth in the chemicals sector amounted to 27.1 percent.

Fitch affirms ratings of Azernerji and SOCAR

Fitch Ratings has revised the Outlook on OJSC Azerenerji's (national energy operator) Long-term foreign currency Issuer Default Rating (IDR) to Stable from Positive and affirmed the rating at 'BBB-', the agency's statement said. Short-term foreign currency IDR was affirmed at 'F3'.

Fitch has also affirmed State Oil Company of the Azerbaijan Republic's (SOCAR) Long-term foreign currency IDR at 'BBB-' with a Stable Outlook. Short-term foreign currency IDR was affirmed at 'F3' while senior unsecured rating was affirmed at 'BBB-'.

"The revision of Azerenerji's Outlook to Stable reflects the agency's revision of the Outlook on the Republic of Azerbaijan's Long-term foreign IDR to Stable from Positive on 11 May 2012 (Fitch revised Azerbaijan's Outlook to Stable; affirmed at 'BBB-'). The revision of the Outlook on the sovereign rating, and consequently Azerenerji's rating, better reflects Fitch's view on their likely direction," the statement says.

Azerenerji's ratings are aligned with the Republic of Azerbaijan ('BBB-'/Stable/'F3') reflecting strong legal, strategic and operational ties with the government of Azerbaijan. At YE11 87.1 percent of the company's debt was guaranteed by the government.

Azerbaijani Ecology Ministry approves development programme for Gosha gold deposit

Anglo Asian Mining plc, the AIM listed gold producer, has received approval from the Ministry of Ecology and Natural Resources for the Development and Production Programme for its Gosha Gold Deposit ('Gosha') in Azerbaijan.

"The Company aims to commence the development of Gosha into a small, profitable, high grade underground gold mine producing gold at an average rate of 10,000 to 15,000 ounces per annum for a period of up to five years," the message said.

Under the terms of the Production Sharing Agreement ("PSA"), the Company is required to commence development and production of Gosha within one year, as from April 25, 2012 unless otherwise agreed in writing between the parties to the PSA.

Given the Company's intention to construct an agitation leaching plant at the Company's flagship mining operation Gedabek, also in Azerbaijan, the Company intends to request that the Government of Azerbaijan agree that the commencement of the Development and Production Programme is delayed until H1 2013 so that the efforts of the Company can be focused on the agitation leaching plant construction.

Number of infected computers increased in Azerbaijan

The number of infected computers in Azerbaijan increased by 52.5 percent in the first quarter, which is 10.35 percent more compared to same period of last year, the survey of Kaspersky Lab virus activity indicates.

Azerbaijan is ranked third among the ten countries that faced the greatest risk of infection (following Russia - 58 percent and Tajikistan - 52.9 percent) through the Internet.
Azerbaijan was ranked sixth last year.

Russia, Tajikistan, Armenia, Azerbaijan, Kazakhstan, Belarus, Ukraine, Cote d'Ivoire, Bangladesh and Sudan are included in the top 10 countries with a score of58 - 43,70 percent.

The company has calculated the number of Web-security use per country within the month to assess the risk of infection through the Internet in different countries worldwide.
Kaspersky Lab found and cleared nearly one billion of malware, which is 28 percent more than in the previous quarter.

Half of attacks were attempts of malicious code penetration through the Internet. This is ten percent higher than last quarter. In the intervening period has been fixed spread of malware 95080549 URL, which is 61 percent more than in the fourth quarter of 2011.

Azerbaijan creates large raw material base for plastic and rubber production

The manufacture of chemical products has more than tripled in Azerbaijan during the period of Azerkimya of State Oil Company of Azerbaijan (SOCAR) activity, head of staff at the Ministry of Energy and Industry Rasim Mammadov said in a speech at the opening ceremony of the second Caspian international exhibition, Plastic and Rubber.

"It has created a large source of raw materials for the production of plastic and rubber products in Azerbaijan," Mammadov said.

He noted that if there were nine enterprises for the production of such products with a turnover of nine million manat in 1995, then the number of enterprises has now grown to 60 with a turnover of 70 million manat.

He said the production of chemical products will continue to grow which will provide both domestic demand and increase export potential.

Azerbaijani technology park starts exporting goods

The Sumgait Technology Park has started exporting its products.

The goods of the cable plant are mainly being exported. The goods are exported to the Caspian countries.

The geography of exports will expand and cover the neighbouring countries such as Russia, Iran, Turkey and then European countries in the near future, he said. The Sumgait industrial park will run at full capacity by late 2013.

A number of technologies being used at the park are considered a novelty, not only for Azerbaijan, but also for the entire region. For example, some installations and cables relating to alternative energy are not manufactured in the CIS countries.

Eurovision-2012 song contest guests to be accommodated in Baku bay ships

Besides the hotels, there are three ships for accommodating guests arriving in Baku for the Eurovision-2012 song contest.

These ships are moored in the waters of Baku Bay, near the yacht club located at the National Sea Park. Each of these vessels can accommodate 100 people.

He also stressed that Eurovision participants are being placed in Baku hotels. Currently, around 5000 people have been accommodated. There are enough rooms available for new tourists and to date guests have been satisfied with the arrangements.

Azerbaijan simplifies state bond issuance

Based on the Azerbaijani State Securities Committee's decision, the rules were approved to issue and circulate state bonds, which are included in the state register of legal acts, the committee said.

According to the new rules, registration of state bond issuance is being simplified. the international identification number will be assigned to each bond by the National Numbering Agency.

Electronic reporting system introduced at Baku Stock Exchange

The Baku Stock Exchange (BSE) informs that from now on for the purpose of improvement of the reporting system and enhancement of the electronic document circulation at the stock exchange the reports on the bids placed and transactions concluded by the members of the stock exchange can be directly obtained from the BSE's trading system via remote workplaces, BSE said.

Since May 14 three members of BSE have already been connected to the electronic reporting system of the stock exchange. All other members are expected to be linked to the new feature till the end of the current week.

Only local organizations may be members of the exchange.

The BSE has 16 members. Membership fees at the BSE hit 60,000 manat.

At present, the BSE has 19 shareholders, including the Istanbul Stock Exchange. The BSE authorized capital is 1.2 million manat.

May 16

Azerbaijani State Maritime Administration attends IMO session

The delegation, led by head of the Azerbaijani State Maritime Administration Gudrat Gurbanov, took part in the 90th Session of the Maritime Safety Committee of the International Maritime Organization (IMO). The Azerbaijani delegation went to London to attend the session, which runs from May 16-25. The agenda includes the measures to enhance maritime safety, the definition of standards in the construction of new ships, the introduction and use of early warning systems, identification and tracking (UMTİ / LRİT) for the ships, improving the rescue and search operations at sea, navigation and fire safety. Moreover, the participants will discuss the transportation of hazardous materials, dry goods and containers, the stability of ships, cargo signs, safe transportation of liquefied gases and products, the use of an international convention of 1978 to prepare sailors and other issues.

May 17

Baku-Supsa oil pipeline shut down for prophylactic operations

BP as operator of the Azeri-Chirag-Gunashli (ACG) field development project has shut down the Western Route Export Pipeline (WREP/Baku-Supsa) for a planned maintenance programme, the company said.

Work will be carried out as part of ACG annual work programme.

The company said WREP will be shut down for about a month.

The maintenance programme workscope will mainly include continuation of installation of a pig launcher/receiver isolation valves both in Georgia and Azerbaijan, control system upgrade activities and other general mechanical and instrument maintenance work.

Production from all ACG platforms, as well as the SD platform, and export operations via BTC and SCP will continue as normal. Loadings at Ceyhan will continue as planned.

The Sangachal Terminal will continue to operate coordinating their day-to-day operations with the WREP maintenance activities.

Azerbaijani Accounting Chamber discusses state budget execution

The Azerbaijani Accounting Chamber has discussed its conclusion of an annual report on the state budget's execution and the bill on "Executing the Azerbaijani State Budget in 2011".

Special attention in the conclusion has been paid to the analysis of macroeconomic indices that characterized the country's economy in 2011 and the factors affecting the economy.

Moreover, the conclusion includes the proposals and recommendations of the Accounting Chamber in many areas.

The chamber also approved the conclusion and decided to submit the report for discussion in the Azerbaijani Parliament.

Baku Metro to operate round-the-clock during Eurovision Song Contest 2012

Baku Metro will operate a round-the-clock service during the semi-finals and final of the Eurovision Song Contest 2012.

Baku Metro's operating schedule during these days has already been approved and Baku Metro is ready to ensure transportation of residents and guests round-the-clock.

Azerbaijani postal operator switches over to issue of bank statement

Azerbaijani Azerpost postal operator will issue a bank statement instead of receipts when paying for utility bills, Azerpost said.

The process of issuing a bank statement is completely computerised. The statement will be issued by the system as soon as the payment is completed and the funds paid by the consumer, go to account. The procedure is identical to the statement issued by banks today.

"The complete transition to the issuing bank statement is expected by the end of the month," the company said.

The new system complies with the principle of transition to a unified structure of the International Bank Account Number (IBAN).

The main objectives of IBAN is the improvement of the identification of bank customers' accounts in the field of electronic payments, increased automation of payment processing and eliminating fragmentation in the structure of bank accounts currently in use.

Cardiovascular system to be monitored in Azerbaijan

The Cybernetics Institute of the Azerbaijani National Academy of Sciences will present a prototype of a mobile software and hardware complex to monitor the cardiovascular system by using robust technology and theory of voice monitoring next month, Director of the Institute Telman Aliyev said.

He said that an Azerbaijani scholar in Turkey deals with the development of this system to use it in medicine.

"The prototype of the system will be delivered to Azerbaijan by early June," he said. "An application for mobile phone has been already developed within the project. Today, the main issue is the integration of the opportunity of receiving information from sensors to its system. Radio channels will be used to send a signal. The initial results within this project are encouraging. The scholars from Poland, Spain and England are interested in this project. We intend to work with them in this direction."

Using the system in the medical sphere will allow revealing the problems with the cardiovascular system.

Azerbaijan, IAEA discuss danger of Metsamor NPP

Azerbaijan and the International Atomic Energy Agency (IAEA), discussed the danger of the Armenian Metsamor nuclear power plant for the region in Baku, spokesman of the Ministry of Industry and Energy Azer Mensimli said.

Discussions were held during the meeting between Deputy Minister of Industry and Energy Natig Abbasov and IAEA Internal Oversight Services Director Carsten Meyer.

In particular, during the meeting Abbasov stressed the emergency state of ANPP and its danger for the whole region. Accident at Fukushima-1 in Japan was called as an example of consequences after such accidents.

The Deputy Minister noted that the IAEA should make an effort to close the station.

The projects Development of a major national energy plan and Support the use of atomic energy were also discussed during the meeting. The sides discussed prospects for further cooperation.

ADB appreciates work on securities market development in Azerbaijan

The ADB financial mission held a meeting at the Azerbaijani State Securities Committee in Baku, the committee said.

The purpose of the meeting was to determine the opportunities of the ADB technical assistance project "Financial Sector Development in Central and West Asia" to increase the potential of the staff of the committee, as well as to cooperate in the field of securities.

Chairman of the Azerbaijani State Securities Committee Rufat Aslanli said at a meeting that the main institutions have been formed on the Azerbaijani capital market.

"The growth has been recently observed on the securities market as a result of targeted measures," Aslanli said.

Head of the delegation, ADB financial sector specialist Jurgen Conrad expressed his satisfaction with the work on the development of securities market in Azerbaijan and mutual cooperation.

UAFA to help teach disabled children in Azerbaijan

Ministry of Labour and Social Protection of Azerbaijan has signed with United Aid for Azerbaijan (UAFA) a pilot contract to support the country's children with disabilities and their parents. The contract was signed for one year.

"This is the first such project in Azerbaijan and in the initial phase it will cover more than 375 disabled children and their parents living in Yasamal district of Baku, Sumgait, Ganja, Sheki and Khachmaz," the head of the Social Policy department of the Ministry of Labour, Elnur Sultanov, told reporters.

He said under the project it's planned to provide services on a voluntary basis with the use of an integrated approach by highly qualified specialists for social and educational rehabilitation of children with disabilities.

Such modern techniques, as functional assessment, active therapy and play therapy will be used.

The pilot project is supported by the European Union under the project "Reform of Social Rights: The involvement in early childhood education of disabled children and children with disabilities" in Azerbaijan.

Coverage of loan repayment services through Paypoint terminals expanded in Azerbaijan

Komtec Company signed an agreement with six banks for the provision of services on the repayment of loans through the Paypoint terminals commercial director of Komtec Farid Ismayylzade said.

In the near future, the public will have an opportunity to repay the loans obtained in TuranBank, AGBank, Unibank, Express Bank, Bank Respublika, and Azerbaijan Senaye Bank.
Currently loans of Azeri DemirBank can be repaid through the terminals.

You should select "Baking" option on the screen, enter the code and to confirm it, to give money in the terminal and get a check in order to repay the loan through the terminal. There will be no commission for the repayment of loans.

If payments are made after 17:00 or in day offs it will be accepted during the next day. The terminals accept only manat, and loans in dollars can be paid in manat, taking into account exchange rates.

May 18

ADB discusses development perspectives of Azerbaijani securities market

The management of Baku Stock Exchange held a meeting with Jurgen Conrad, Senior Economist, Central and West Asia Regional Department of Asian Development Bank.

During the meeting the parties discussed the current situation and development perspectives of the Azerbaijani securities market and the equities market particularly.

"It is worth to note that the meeting took place within the project of preparation of the ADB's 2013-2017 Country Partnership Strategy for Azerbaijan," the press release says.

Azerbaijan almost completes POS-terminal installation in tourist centers

Azerbaijan has almost completed the installation of POS-terminals at tourist centers, Tax Minister Fazil Mammadov said during a speech at a session devoted to the works on introducing and installation of non-cash payments of POS-terminals.

The meeting was attended by officials from ministries of taxes, economic development, transportation, communications and information technologies, as well as the Central Bank, banks and businesses.

"The work on installation of POS terminals in hotels, in the objects of trade, catering, leisure and entertainment, taxis, gas stations, the facilities providing health service involved in the sale of pharmaceutical products and other objects is nearly completed. The ministry created a special office to oversee the execution of these works" Mammadov said.

He noted that delivery of POS-terminals was provided due to active involvement of acquiring banks to the work.

New accountability system of professional participants presented in Azerbaijan

The Azerbaijani State Securities Committee held a presentation of the new accountability system for professional participants within the new rules which entered into force to submit the reports on the deals concluded on the stock market, the committee said.

The detailed information about the types of reports determined in accordance with the new rules, their preparation, as well as the procedures of making the reports in electronic form was delivered during the presentation.

The professional participants of the securities market exchanged the views during the presentations.

Merchant shipping to be licensed in Azerbaijan

A special permit (license) will be required in the field of merchant shipping to operate in cargo and passenger transportation by ships in Azerbaijan.

The additions will be made to the Azerbaijani Merchant Shipping Code. The parliamentary committee on economic policy has today recommended submitting a bill on amendments to the Code to the Azerbaijani Parliament for discussion.

Moreover, according to the amendments, the ship owners must submit a certificate on insurance or other financial security to civil liability for damage incurred as a result of water pollution by bunker oil.

The additions envisage inspecting at least a quarter of the average annual number of vessels (this number should be calculated on the basis of the indices for the last three years), sailing under foreign flags and entering the territory of the Azerbaijani sea ports.